President Lee Jae-myung met with the Korean Confederation of Trade Unions (KCTU) on Thursday and called for guaranteeing collective bargaining rights for small business owners. His remarks are interpreted as calling for revision of current laws that classify collective action by small businesses against large corporations as "collusion."
Lee had pledged to grant collective bargaining rights to small and medium enterprises during the 20th and 21st presidential elections, but the initiative was never properly pursued. With the ruling party now holding a majority in the National Assembly, observers expect the legislative revision to gain momentum.
"Allow Collective Bargaining and Solidarity Rights for Small Businesses"
At a meeting with KCTU held at the Blue House, President Lee opened by stating, "Small business owners should also be allowed collective bargaining and at minimum, solidarity rights."
"The fundamental position of workers as the weaker party has always been a problem," Lee said. "The three labor rights—solidarity, collective action, and collective bargaining—are guaranteed by the Constitution, but I question whether solidarity rights are sufficiently secured to function effectively."
He elaborated that "opportunities for collective bargaining should be given on a case-by-case basis—suppliers negotiating together, franchise stores together, branch offices together."
Current Law Treats It as 'Collusion'; Revision Would Make It a 'Bargaining Tool'
Under the current Fair Trade Act, collective action by small-scale businesses against large corporations is classified as "collusion." During the last presidential election, Lee pledged to grant collective bargaining rights to SMEs supplying to large corporations to strengthen their negotiating power. The Democratic Party of Korea had also included this in its 2022 election platform, but the initiative stalled after the party lost that race.
However, with the ruling Democratic Party now holding a majority in the current National Assembly, the Fair Trade Act revision is expected to gain traction. The Fair Trade Commission has also been pursuing measures to exempt certain joint activities among small business operators from the "collusion" designation. The aim is to treat actions by small business owners or franchisees forming groups to negotiate prices, fees, and terms with headquarters as "bargaining power supplements" rather than competition restrictions or collusion.
The commission is also examining ways to institutionalize the rights to form organizations and negotiate for franchise owner associations and dealer groups. An FTC official explained, "We are looking at excluding economically vulnerable parties from the scope of the Fair Trade Act to guarantee a fair share for small-scale business operators."
"Is the Fixed-Term Law Actually a 'Two-Year Employment Ban'?"
Lee also raised the issue of labor market dualization. Pointing to the side effects of the current Fixed-Term Employment Act, he said, "Because of the legal provision requiring conversion to permanent employment after two years, companies cut contracts at exactly one year and 11 months and never extend beyond two years. This actually forces unemployment."
He added, "What was meant to protect workers has essentially become a 'forced abandonment law.' I hope we can think practically about how to solve this problem."
Lee requested that KCTU participate more actively in social dialogue to address these issues. He also called for coordination between the two major labor federations, saying, "If possible, I'd like the Federation of Korean Trade Unions and KCTU to move together rather than separately."
"Physical AI Will Eliminate Jobs"... "No Need for Excessive Fear"
The introduction of artificial intelligence in industrial workplaces was also discussed extensively. In response to KCTU's concerns that AI technology could seriously threaten workers' jobs, Lee said, "There's no need for excessive fear," and proposed "joint research on active utilization methods."
KCTU Chairman Yang Kyung-soo raised the topic, saying, "The biggest concern at workplaces is AI." He continued, "Given the historical experience that automation means job loss, concerns are inevitable. Physical AI seeks complete job elimination, not just transformation, so countermeasures must differ from previous ones."
Yang emphasized that "this should not simply remain a jobs policy but requires comprehensive discussion and measures covering social safety nets, labor rights, and how to recoup excess corporate profits generated by AI."
Lee expressed agreement, saying, "Everything you've said is correct." He added, "AI adoption worries me too, but it's unavoidable. If the labor community discusses countermeasures, I will accept them to the maximum extent possible and implement them as government policy all at once."
He continued, "Rather than avoiding this, we need to respond proactively. If necessary, we will provide full support, whether financial or human resources."
This was President Lee's first one-on-one meeting with KCTU since taking office.
